SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

(Mark One)

☒     Quarterly report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934

 

For the quarterly period ended March 31,June 30, 2018

 

OR

 

☐     Transition report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934

 

For the transition period from ___________ to ___________

 

Commission file number 000-55740

 

ANUTRA CORPORATION

(Exact name of registrant as specified in its charter)

 

Delaware 81-4625032
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

 

248 Hatteras Avenue

Clermont, FL 34711

(Address of principal executive offices) (zip code)

 

321-221-0233

(Registrant’s telephone number, including area code)

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

☒Yes ☐ No

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files.

☐Yes ☒ No

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

 

Large accelerated filer☐Accelerated filer☐
Non-accelerated filer☐Smaller reporting company☒
  Emerging growth company☐☒

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards pursuant to Section 13(a) of the Exchange Act. ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ YesNo ☒ No

 

Indicate the number of shares outstanding of each of the issuer’s classes of stock, as of the latest practicable date.

 

Common Stock, par value $0.0001 - 25,973,400 shares as of May 21, 2018September 12, 2018.

   

 

 

 

 

ANUTRA CORPORATION

Index

  

Part I. Financial Information 
   
Item 1.Financial Statements 
   
 CondensedConsolidated balance sheets - March 31,– June 30, 2018 (unaudited) and December 31, 20171
   
 CondensedConsolidated statements of operations -– Three and Six months ended March 31,June 30, 2018 and 2017 (unaudited)2
   
 CondensedConsolidated statement of stockholders’ equity – Six months ended June 30, 2018 (unaudited)3 
Consolidated statements of cash flows - Three– Six months ended March 31,June 30, 2018 and 2017 (unaudited)34-5
   
 Notes to the condensedconsolidated financial statements– March 31, 2018 and 2017statements – (unaudited)46
   
Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations812
   
Item 3.Quantitative and Qualitative Disclosures About Market Risk815
   
Item 4.Controls and Procedures815
   
Part II.  Other Information916
   
Item 1.Legal Proceedings916
   
Item 1A.Risk Factors916
   
Item 2.Unregistered Sales of equityEquity Securities and Use of Proceeds916
   
Item 3.Defaults Upon Senior Securities1016
   
Item 4.Mine Safety Disclosures1016
   
Item 5.Other Information1016
   
Item 6.Exhibits1016
   
Signatures1117

   

 i

 

 

ANUTRA CORPORATIONAnutra Corporation and Subsidiary

(FORMERLY STILL SOUND ACQUISITION CORPORATION)

CONDENSED BALANCE SHEETS

As of March 31, 2018 (Unaudited) and December 31, 2017Consolidated Balance Sheets

 

  March 31,
2018		  December 31,
2017		 
  (Unaudited)    
ASSETS        
         
Current assets        
Cash $-  $- 
         
Total assets $-  $- 
         
LIABILITIES AND STOCKHOLDERS’ (DEFICIT)        
         
Current liabilities        
Accrued liabilities $1,000  $1,000 
         
Total liabilities  1,000   1,000 
         
Stockholders’ (deficit)        
Preferred stock, $0.0001 par value, 20,000,000 shares authorized; none outstanding  -   - 
Common stock, $0.0001 par value, 100,000,000 shares authorized; 6,500,000 and 20,000,000 shares issued and outstanding as of March 31, 2018 and December 31, 2017, respectively  650   2,000 
Additional paid-in capital  3,795   1,851 
Accumulated deficit  (5,445)  (4,851)
Total stockholders’ (deficit)  (1,000)  (1,000)
         
Total liabilities and stockholders’ (deficit) $-  $- 

  June 30,  December 31, 
  2018  2017 
  (unaudited)    
ASSETS      
       
Current assets      
Cash $46,608  $94,378 
Accounts receivable, net  21,068   15,055 
Inventory  145,295   162,347 
Prepaid expense  -   80,000 
Total current assets  212,971   351,780 
         
Equipment, net  6,247   6,771 
         
Other assets        
Security deposits  3,300   3,300 
         
  $222,518  $361,851 
         
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)        
         
Current liabilities        
Accounts payable $94,795  $84,608 
Accrued expenses  14,414   5,210 
Patent license fee payable to a related party  366,802   - 
Customer deposits  22,000   15,000 
Note payable  50,000   50,000 
Total current liabilities  548,011   154,818 
         
Long-term liabilities        
Notes payable  111,500   61,500 
Notes payable, related parties  40,000   40,000 
Total long-term liabilities  151,500   101,500 
         
Total liabilities  699,511   256,318 
         
Stockholders’ equity (deficit)        
Common stock, $.0001 par value, 100,000,000 shares authorized, 25,973,400 and 20,000,000 shares issued and outstanding as of June 30, 2018 and December 31, 2017, respectively  2,597   2,000 
Additional paid-in capital  1,254   1,851 
Retained earnings (accumulated deficit)  (480,844)  101,682 
Total stockholders’ equity (deficit)  (476,993)  105,533 
         
  $222,518  $361,851 

 

The accompanying notes are an integral part of these condensedconsolidated financial statements.

  

1 

1

 

ANUTRA CORPORATIONAnutra Corporation and Subsidiary

(FORMERLY STILL SOUND ACQUISITION CORPORATION)

CONDENSED STATEMENTS OF OPERATIONS

for the three months ended March 31, 2018 and 2017Consolidated Statements of Operations

(Unaudited)

 

  March 31,
2018		  March 31,
2017		 
Revenue $-  $- 
Cost of revenues  -   - 
         
Gross profit  -   - 
         
Operating expenses  594   789 
         
Loss before income taxes  (594)  (789)
         
Income taxes  -   - 
Net loss $(594) $(789)
         
Loss per share – basic and diluted $0.00  $0.00 
         
Weighted average shares – basic and diluted  17,450,000   20,000,000 

  Three Months Ended  Six Months Ended 
  June 30,  June 30, 
  2018  2017  2018  2017 
             
Sales revenue $33,166  $30,335  $74,466  $116,509 
                 
Cost of goods sold                
Cost of goods  11,309   14,433   31,031   39,071 
Freight and shipping  1,850   3,225   8,433   8,568 
   13,159   17,658   39,464   47,639 
                 
Gross profit  20,007   12,677   35,002   68,870 
                 
Sales and marketing expenses  3,881   1,452   17,611   3,882 
General and administrative  497,887   21,103   590,405   43,457 
Total operating expenses  501,768   22,555   608,016   47,339 
                 
Income (loss) from operations  (481,761)  (9,878)  (573,014)  21,531 
                 
Other income (expense)                
Retained customer deposit  -   48,531   -   48,531 
Interest expense  (4,968)  -   (9,512)  - 
                 
Net income (loss) $(486,729) $38,653  $(582,526) $70,062 
                 
Income (loss) per share - basic and diluted $(0.03) $-  $(0.03) $- 
                 
Weighted average shares - basic and diluted  18,911,620   20,000,000   18,184,850   20,000,000 

 

The accompanying notes are an integral part of these condensedconsolidated financial statements.

 

2 

2

 

ANUTRA CORPORATIONAnutra Corporation and Subsidiary

(FORMERLY STILL SOUND ACQUISITION CORPORATION)

CONDENSED STATEMENTS OF CASH FLOWS

for the three months ended March 31, 2018 and 2017Consolidated Statement of Stockholders’ Equity

(Unaudited)

 

  March 31,
2018		  March 31,
2017		 
       
CASH FLOWS FROM OPERATING ACTIVITIES        
         
Net loss $(594) $(789)
         
Expenses paid by stockholders and contributed as capital  594   789 
         
Net cash provided by operating activities  -   - 
         
Net cash provided by investing activities  -   - 
         
Net cash provided by financing activities  -   - 
         
Net increase (decrease) in cash  -   - 
         
Cash, beginning of period  -   - 
         
Cash, end of period $-  $- 
         
SUPPLEMENTAL DISCLOSURES:        
Cash paid during the period for:        
Income tax $-  $- 
Interest  -   - 

  Common Stock  Additional Paid-In  Retained Earnings
(Accumulated		  Total
Stockholders’
Equity		 
  Shares  Amount  Capital  Deficit)  (Deficit) 
                
Balance, January 1, 2018  20,000,000  $2,000  $1,851  $101,682  $105,533 
Cancellation of common stock shares  (19,500,000)  (1,950)  1,950   -   - 
Issuance of common stock shares  6,000,000   600   (600)  -   - 
Common stock shares issued to affect reverse merger  19,473,400   1,947   (1,947)  -   - 
Net loss  -   -   -   (582,526)  (582,526)
                     
Balance, June 30, 2018  25,973,400  $2,597  $1,254  $(480,844) $(476,993)

 

The accompanying notes are an integral part of these condensedconsolidated financial statements.


3

ANUTRA CORPORATION

(FORMERLY STILL SOUND ACQUISITION CORPORATION)Anutra Corporation and Subsidiary

Consolidated Statements of Cash Flows

(Unaudited)

  Six Months Ended 
  June 30, 
  2018  2017 
       
Cash flows from operating activities      
Cash received from customers $75,453  $176,633 
Cash paid to suppliers and employees  (173,223)  (136,323)
Net cash provided by (used in) operating activities  (97,770)  40,310 
         
Cash flows from investing activities        
Purchase of equipment  -   (650)
Net cash used in investing activities  -   (650)
         
Cash flows from financing activities        
Proceeds from note payable  50,000   - 
Distributions to member  -   (52,091)
Net cash provided by (used in) financing activities  50,000   (52,091)
         
Net decrease in cash and cash equivalents  (47,770)  (12,431)
         
Cash and cash equivalents, beginning of period  94,378   14,673 
         
Cash and cash equivalents, end of period $46,608  $2,242 

The accompanying notes are an integral part of these consolidated financial statements.

4

Anutra Corporation and Subsidiary

Consolidated Statements of Cash Flows

(Unaudited)

  Six Months Ended 
  June 30, 
  2018  2017 
       
Reconciliation of net income (loss) to net cash provided by (used in) operating activities:      
       
Net income (loss) $(582,526) $70,062 
         
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:        
Depreciation  524   442 
Amortization of prepaid expense  80,000   - 
         
Changes in operating assets and liabilities:        
Accounts receivable  (6,013)  11,592 
Inventory  17,052   (40,476)
Accounts payable and accrued expenses  19,391   (1,310)
Patent license fee payable to a related party  366,802   - 
Customer deposits  7,000   - 
         
Net cash provided by (used in) operating activities $(97,770) $40,310 

The accompanying notes are an integral part of these consolidated financial statements.

5

Anutra Corporation and Subsidiary

Notes to the Unaudited CondensedConsolidated Financial Statements

March 31, 2018 and 2017

NOTE 1 - NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NATURE OF OPERATIONS

1.NATURE OF BUSINESS

 

Anutra Corporation, formerly Still Sound Acquisition Corporation (the “Company”) was incorporated on December 7, 2016 under the laws of the stateState of Delaware to engage in any lawful corporate undertaking, including, but not limited to, selected mergers and acquisitions. The Company changed its name in February 2018 in anticipation of a change in control. Effective May 4th, 2018 the Company entered into a reverse merger agreement, (see Note 5 and 6), that is effectively a stock-for-ownership units exchange. The business combination was structured to be within the definition of a tax-free reorganization under Internal Revenue Code Section 351 or Section 368. The Company was originally formed to provide a method for a foreign or domestic private company to become a reporting company with a class of securities registered under the Securities Exchange Act of 1934.

 

BASIS OF PRESENTATIONThe Company produces and sells products made with a new cultivar of grain, marketed as ANUTRA® Grain. ANUTRA® Grain products are sold as food and nutritional supplements on the internet and through national health food retailers. ANUTRA® Grain is also sold to major food manufacturers as an ingredient for their products.

 

2.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The summary of significant accounting policies presented below is designed to assist in understanding the Company’s unaudited condensedconsolidated financial statements. Such unaudited condensedconsolidated financial statements and accompanying notes are the representationsrepresentation of the Company’s management, who are responsible for their integrity and objectivity. These accounting policies conform toThe accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) in all material respects and have been consistently applied in preparing the accompanyingfor interim financial statements.

Certain information and footnote disclosures normally present in annual financial statements prepared in accordance with US GAAP were omitted pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). for quarterly reports on Form 10-Q. Accordingly, they do not include all the information and footnotes required by US GAAP for complete financial statements.

The unaudited financial information included in this report includes all adjustments (consisting of normal recurring adjustments) which are, in the opinion of management, necessary to reflect a fair statement of the results for the interim periods. The results of operations for the three and six months ended March 31,June 30, 2018 are not necessarily indicative of the results toof the full fiscal year.

The consolidated financial statements included in this report should be expected forread in conjunction with the ending December 31,financial statements and notes thereto included in the Company’s Form 8-K/A describing the reverse merger, as filed with the SEC on August 24, 2018.

 

USE OF ESTIMATESConsolidation Policy

The accompanying consolidated financial statements include the accounts of Anutra Corporation and Anutra Super Grain LLC under the guidelines for consolidated financial statements as required by US GAAP. The guidelines require the elimination of intercompany transactions and balances from the consolidated financial statements.

 

Use of Estimates

The preparation of unaudited condensedconsolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensedconsolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates.

  


6

ANUTRA CORPORATION

(FORMERLY STILL SOUND ACQUISITION CORPORATION)Anutra Corporation and Subsidiary

Notes to the Unaudited CondensedConsolidated Financial Statements

March 31, 2018

Accounts Receivables and 2017Revenue Recognition

Accounts receivable are recorded at the principal amount receivable and are shown net of an allowance for uncollectible accounts. In establishing the allowance for uncollectible accounts management evaluates history with customers, their creditworthiness, and business and economic conditions.

 

INCOME TAXES

UnderIn May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-19, “Revenue from Contracts with Customers (Topic 606)”, which requires an entity to recognize revenue from the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance addresses, in particular, contracts with more than one performance obligation, as well as the accounting for some costs to obtain or fulfill a contract with a customer; and provides for additional disclosures with respect to revenues and cash flows arising from contracts with customers. With respect to public entities, this update, together with subsequent amendments, was effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. The Company adopted this guidance effective January 1, 2018.

The core principal of ASU 2019-09 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Using this principle, a comprehensive framework was established for determining how much revenue to recognize and when it should be recognized. To be consistent with this core principle, an entity is required to apply the following five-step approach:

●Identify the contract(s) with a customer;
●Identify each performance obligation in the contract;
●Determine the transaction price;
●Allocate the transaction price to each performance obligation; and
●Recognize revenue when or as each performance obligation is satisfied.

The Company’s revenue comes substantially from the sale of manufactured consumable products which are shipped to customers.

Revenue is reported net of discounts which include primarily early pay discounts and customer refunds. These discounts totaled $2,477 and $8,587 for the six months ended June 30, 2018 and 2017, respectively.

The Company adopted ASU 2019-09 using the modified retrospective method and did not have any material change to their revenue resulting from this adoption.

Inventory and Costs of Goods Sold

Inventory consists of purchased grain and the related packaging materials and supplies. Inventory is stated at lower of cost or net realizable value determined on the first-in, first-out basis.

Inventory and packaging costs are recognized in costs of goods sold when the associated revenue is recorded.

7

Anutra Corporation and Subsidiary

Notes to the Unaudited Consolidated Financial Statements

Equipment

Equipment is carried at cost. Depreciation is provided over the estimated useful lives of the assets on the straight-line method. The estimated useful lives for the different classes of depreciable assets are:

Office Furniture and Equipment3 – 10 years
Machinery and Equipment20 – 25 years
Website5 years

Expenditures for repairs and renovations that extend the useful lives of the equipment are capitalized when the expenditure exceeds $2,500. Expenditures for costs below this amount are charged to expense as incurred.

Customer Deposits

The Company occasionally requests deposits from customers on large orders that will be shipped overseas. These amounts may be refunded based on individual circumstances.

As of June 30, 2018 and December 31, 2017, the Company has recorded a customer deposit liability of $22,000 and $15,000 for a deposit on an order that is expected to be shipped in the fall of 2018.

Advertising Costs

Advertising costs are expensed as incurred and are included in sales and marketing expenses in the statements of operations.

Income Taxes

Under FASB Accounting Standards Codification (“ASC”) 740, “Income Taxes”, deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Valuation allowances are established when it is more likely than not that some or all of the deferred tax assets will not be realized. As of March 31,June 30, 2018 and December 31, 2017, theredeferred tax assets and valuation allowances were no deferred taxes due to the uncertainty of the realization of the net operating loss carry forward prior to expiration. The net$581,373 and $4,851, respectively. Net operating loss carryforwards and valuation allowances are $594$215,724 and $4,851 as of March 31,June 30, 2018 and December 31, 2017, respectively. The carryforward periods expire in 2038 and 2037 respectively.

 

LOSS PER COMMON SHARENone of the Company’s Federal or State income tax returns are currently under examination by the taxing authorities. Tax years 2014 and later are subject to tax examination.

 

Basic loss per common share excludes dilutionThe Company has reviewed and is computed by dividing net loss by the weighted average numberevaluated tax positions taken and has determined there are no uncertain tax positions taken that would require recognition of common shares outstanding during the period. Diluted loss per common share reflect the potential dilution that could occur if securitiesa liability or other contracts to issue common stock were exercisedasset or converted into common stock or resulteddisclosure in the issuance of common stock that then shared infinancial statements.

8

Anutra Corporation and Subsidiary

Notes to the lossUnaudited Consolidated Financial Statements

Recently Issued Accounting Pronouncements

In March 2016, the FASB issued ASU 2016-09,Compensation – Stock Compensation (Topic 718), Improvements to Employee Share-Based Payment Accounting.The standard was effective for public companies for annual reporting periods beginning after December 15, 2016. In June 2018, the FASB issued ASU 2018-07,Compensation – Stock Compensation Topic (718), Improvements to Nonemployee Share-Based Payment Accounting. ASU 2016-09 was part of the entity. ForFASB’s Simplification Initiative. The areas for simplification involve several aspects of accounting for share-based payment transactions with employees, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU 2018-07 extended these provisions to share-based payment transactions for acquiring goods and services fromnonemployees. ASU 2018-07 is effective for annual reporting periods ended March 31, 2018 and 2017 there were no outstanding dilutive securities.

RECENT ACCOUNTING PRONOUNCEMENTSbeginning after December 15, 2018. Early adoption is permitted.

 

In February 2016, The FASB issued Accounting Standards Update No.ASU 2016-02, “Leases”Leases (Topic 842) (“ASU 2016-02”). The standard is effective for public companies for annual reporting periods beginning after December 31,15, 2018. The standard is effective for nonpublic entities for annual reporting periods beginning after December 15, 2019. Early adoption of the standard is permitted for all entities. This standard will require lessees to recognize right of use assets and lease liabilities arising from leases with terms of more than 12 months. 

The Company is currently indoes not expect that the processadoption of evaluating the impact of ASU 2016-02these standards will have a material effect on its condensedconsolidated financial statements.

3.ACCOUNTS RECEIVABLE

Accounts receivable consist of the following:

  June 30,
2018		  December 31,
2017		 
Accounts receivable $31,526  $29,018 
Allowance for uncollectible accounts  (10,458)  (13,963)
  $21,068  $15,055 

4.INVENTORY

Inventory consists of the following:

  June 30,
2018		  December 31,
2017		 
Raw materials and finished goods $120,579  $135,864 
Packaging materials  24,716   26,483 
  $145,295  $162,347 

Raw materials and finished goods inventories consist of chia grain and peanut flour. The grain is subject to different processes depending on whether the final product will be sold as whole, ground, or microfine grain.


9

ANUTRA CORPORATION

(FORMERLY STILL SOUND ACQUISITION CORPORATION)Anutra Corporation and Subsidiary

Notes to the Unaudited CondensedConsolidated Financial Statements

5.PREPAID EXPENSE

The Company consummated a reverse merger on May 7, 2018. The Company is planning a public stock offering for late 2018. During 2017, they entered into an agreement with a corporate consultant to assist with this process and have paid fees for services related to the reverse merger and public stock offering of $80,000. For the quarters ended June 30, 2018 and March 31, 2018, $55,000 and $25,000, respectively was recognized as an expense and included in General and administrative expenses.

6.EQUIPMENT

Equipment consists of the following:

  June 30,
2018		  December 31,
2017		 
       
Office furniture and equipment $1,575  $745 
Machinery and equipment  4,650   4,000 
Website  2,545   2,545 
   8,770   7,290 
Accumulated depreciation  (2,523)  (1,999)
  $6,247  $6,771 

7.NOTES PAYABLE

To pay for the costs of the merger and stock offering, the Company borrowed $40,000 from three board members and $111,500 from 11 individuals in 2017, plus $50,000 from an individual in 2018. The note repayment terms include 10% annualized interest rate in addition to shares of the public company. As the issuance of shares upon the public offering is uncertain and the fair value is undeterminable no value has been recorded for these shares as of June 30, 2018. With the exception of one note for $50,000 which has a specified due date of December 31, 2018, these notes have no specified repayment date. However, they are due from the proceeds of the public offering, if and when it occurs.

8.COMMITMENTS

Operating Leases

On December 1st, 2016, the Company entered into a one-year, renewable lease for combined warehouse and office space. The lease was renewed in January 2018 for an additional one-year term. The monthly lease payment is $2,247.

 

NOTE 2 –The Company rents production equipment from its majority member. The leases have five-year terms and are renewable. The start dates and monthly rents are:

Lease start dateMonthly
rent
Equipment lease #1January 1, 2016$                     150
Equipment lease #2July 1, 2017100
Equipment lease #3November 1, 2017100

Future minimum annual lease obligations on long term operating leases are:

Twelve months ending
June 30, 2019$                 4,200
June 30, 20204,200
June 30, 20213,300
June 30, 20222,400
June 30, 2023400

10

Anutra Corporation and Subsidiary

Notes to the Unaudited Consolidated Financial Statements

The Company has an informal agreement for refrigerated storage with an unrelated party.

Rent expense for the six months ended June 30, 2018 and 2017 was $14,085 and $13,572, respectively included under operating expenses and $2,247 and $963, respectively included in cost of goods sold.

Patent License Agreement

On February 27, 2018, the Company entered into a Patent License agreement (the “License”) with its majority shareholder (“Licensor”). The License is effective for the duration of the patent in exchange for payments of $1,000,000 per year. Payment can be made in cash or stock. The terms of the License are controlled at the sole discretion of the Licensor. 

Patent license fees for the six months ended June 30, 2018 were $400,000.

9.RELATED PARTY TRANSACTIONS

The Company leases equipment from the majority shareholder. See disclosure under Commitments (Note 8).

The Company has a Patent Licensing Agreement with its majority shareholder. See disclosure under Commitments (Note 8).

The Company borrowed $40,000 from three board members. See disclosure under Notes Payable (Note 7).

On May 4, 2018, as a result of the reverse merger, the Company issued 14,597,760 shares of common stock, par value of $0.0001 per share, to an officer of the Company, and 2,888,640 shares of common stock to members of its Board of Directors.

10.CONCENTRATIONS

The majority member holds patents on equipment and processes the Company uses to produce its products. The grain is currently processed by an unrelated company in Iowa.

Revenues for the six months ended June 30, 2018 and 2017 include sales from major customers. The following are sales to these customers:

  2018  2017 
Customer A $30,226  $35,093 
Customer B  19,200   17,371 
Customer C  -   51,130 

Accounts receivable from the same customers were as follows:

  June 30,  December 31, 
  2018  2017 
Customer A $9,493  $15,055 
Customer B  11,232   - 
Customer C  -   - 

11.SUBSEQUENT EVENTS

In preparing these consolidated financial statements the Company has evaluated events and transactions for potential recognition or disclosure through September 12, 2018, the date the consolidated financial statements were available to be issued.

12. GOING CONCERN

 

The Company has not yet generated any revenue since inception and has sustained operating losses of $594$582,526 during the threesix months ended March 31, 2018. The CompanyJune 30, 2018 and had an accumulated deficit of $2,995$476,993 as of March 31,June 30, 2018. These results are due primarily to the cost of taking the Company public and the accrual of the patent license fee. The Company’s continuation as a going concern is dependent onupon its ability to generate sufficient cash flows from operations to meetand obtain additional capital from the sale of its obligations and/or obtaining additional financing from its shareholders or other sources, as may be required.equity.

 

The accompanying unaudited condensedconsolidated financial statements have been prepared assuming that the Company will continue as a going concern; however, theconcern. The above conditions raisesraise substantial doubt about the Company’s ability to do so.so without raising additional capital. The unaudited condensedconsolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result should the Company be unable to continue as a going concern.

 

In order to maintain its current level of operations, the Company will require additional working capital from either cash flow from operations or from the sale of its equity. On May 4, 2018, the Company entered into a reverse merger in which it will acquire 100% of the ownership units of Anutra Super Grain LLC, an operating company (“Target”), and the Target will become the surviving company.

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NOTE 3 – ACCRUED LIABILITIES

As of March 31, 2018 and December 31, 2017, the Company had accrued professional fees of $1,000.

NOTE 4 – COMMITMENTS AND CONTINGENCIES

On February 27, 2018, the Company entered into a Patent License agreement (the “License”) with its majority shareholder. The License is effective for the duration of the patent in exchange for payments of $1,000,000 per year. Payment can be made in cash or stock. The terms of the License are controlled at the sole discretion of the majority shareholder.

NOTE 5 – STOCKHOLDERS’ DEFICIT

On December 7, 2016, the Company issued 20,000,000 founders common shares to two directors and officers at par for legal services provided to the Company. On March 14, 2018 19,500,000 of those shares were cancelled and retired. On March 15, 2018, 6,000,000 shares were issued to the majority owner of the Target company to effect a change in control in advance of the Acquisition Agreement.

Changes in the components of stockholders’ deficit for the period ended March 31, 2018 are as follows:

  Common  Additional 
  Stock  Paid-in Capital 
Beginning balances, January 1, 2018 $2,000  $1,851 
Expenses paid by stockholders treated as        
additional paid-in capital  -   594 
Cancellation of 19,500,000 common shares  (1,950)  1,950 
Issuance of 6,000,000 common shares  600   (600)
Ending balances, March 31, 2018 $650  $3,795 


ANUTRA CORPORATION

(FORMERLY STILL SOUND ACQUISITION CORPORATION)

Notes to the Unaudited Condensed Financial Statements

March 31, 2018 and 2017

NOTE 6 - SUBSEQUENT EVENT

As disclosed above, on May 4, 2018 the Company entered into a reverse merger agreement in which it acquired 100% of the outstanding ownership units of the Target by issuing 19,473,400 common shares to the members of Target. Target produces and sells products made with a new cultivar of grain, marketed as “ANUTRA® Grain”. ANUTRA® Grain products are sold as food and nutritional supplements. The Company is expected to sell additional shares to raise capital to fund its expansion. See Form 8-K filed with the SEC on May 7, 2018 for additional information.

Management has evaluated subsequent events through May 21, 2018, the date which the financial statements were available to be issued. All subsequent events requiring recognition have been incorporated into these financial statements.


 

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

  

Still Sound Acquisition Corporation was incorporated on December 7, 2016 underThe following discussion should be read in conjunction with our audited financial statements and notes to our financial statements included elsewhere in this report. This discussion contains forward-looking statements that involve risks and uncertainties. Actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors discussed elsewhere in this report.

Certain information included herein contains statements that may be considered forward-looking statements, such as statements relating to our anticipated revenues, gross margin and operating results, future performance and operations, plans for future expansion, capital spending, sources of liquidity, and financing sources. This forward-looking information involves important risks and uncertainties that could significantly affect anticipated results in the lawsfuture, and accordingly, such results may differ from those expressed in any forward-looking statements made herein. These risks and uncertainties include those relating to our liquidity requirements, the continued growth of the StateCompany’s industry, the success of Delawareour product development, marketing and sales activities, vigorous competition in the Natural Foods Industry, dependence on existing management, leverage and debt service (including sensitivity to engagefluctuations in any lawful corporate undertaking, including, but not limited to, selected mergersinterest rates), domestic or global economic conditions, the inherent uncertainty and acquisitions. On February 19,costs of prolonged arbitration or litigation, and changes in federal or state tax laws or the administration of such laws.

Overview

These numbers are reflective of Anutra Super Grain being a research and development company and investing in taking the company public. As of June 30, 2018, the Company filedhad shareholders’ deficiency of $476,993, and a Certificatecash balance of Amendment to change its name to Anutra Corporation. The$46,608. During the six months ended June 30, 2018, the Company ishad a blank check company and qualifies as an “emerging growth company” as defined in theJumpstart Our Business Startups Act which became law in April, 2012.net loss of $582,526.

 

Since inceptionResults of Operations

During the six months ended June 30, 2018, the Company posted revenues of $74,466, cost of goods sold of $39,464, sales and marketing expenses of $17,611, general and administrative expenses of $590,405, interest expense of $9,512, and net loss of $582,526. The patent license fee of $400,000 is included in general and administrative expenses and is a significant component of the net loss. In contrast, during the six months ended June 30, 2017, the Company posted revenues of $116,509, cost of goods sold of $47,639, sales and marketing expenses of $3,882, general and administrative expenses of $43,457, retained customer deposit of $48,531, and net income of $70,062.

During the three months ended June 30, 2018, the Company posted revenues of $33,166, cost of goods sold of $13,159, sales and marketing expenses of $3,881, general and administrative expenses of $497,887, interest expense of $4,968, and net loss of $486,729. The patent license fee of $400,000 is included in general and administrative expenses and is a significant component of the net loss. In contrast, during the three months ended June 30, 2017, the Company posted revenues of $30,335, cost of goods sold of $17,658, sales and marketing expenses of $1,452, general and administrative expenses of $21,103, retained customer deposit of $48,531, and net income of $38,653.

Liquidity and Capital Resources

As of June 30, 2018, the Company had cash available of $46,608.

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The Company borrowed $40,000 from three board members and $111,500 from 11 individuals in 2017, plus $50,000 from an individual in 2018. The note repayment terms include 10% annualized interest rate in addition to shares of the Company. As the issuance of shares upon the public offering is uncertain and the fair value is undeterminable no value has been recorded for these shares as of June 30, 2018. With the exception of one note for $50,000 which has a specified due date of December 31, 2018, these notes have no specified repayment date. However, they are due from the proceeds of the public offering, if and when it occurs.

In addition to revenues generated from sales, the Chief Executive Officer plans to continue to fund the Company’s operations, if needed, during the next 12 months or until the Company can generate an ongoing source of capital sufficient to Marchindependently continue growing its operations.

There is no assurance that the Company’s activities will generate sufficient revenues to sustain its operations without additional capital, or if additional capital is needed, that such funds, if available, will be obtainable on terms satisfactory to the Company. Accordingly, given the Company’s limited cash on hand, there is substantial doubt that the Company will be able to implement its business plans and proposed operations unless it obtains additional financing or otherwise is able to generate revenues and profits. The Company may raise additional capital through additional sales of debt or equity, obtain loan financing or develop and consummate other alternative financial plans.

Discussion of Financial Position at June 30, 2018 compared to December 31, 2017

During the six months ended June 30, 2018, include issuing sharesthe Company incurred a net loss of common stock.$582,526 due to the cost of becoming a public company and the cost of the patent license fee which went into effect February 28, 2018. This has negatively affected the Company’s financial position as reflected on the consolidated balance sheet with a decrease in available cash of $47,770, an increase in accounts payable and accrued expenses of $19,391, an increase in patent license fee payable to a related party of $366,802, and an increase in notes payable of $50,000.

Management expects the negative trend to continue in the short term as it adds marketing focus to larger industrial food production users in conjunction with retail and on-line strategies.

Discussion of Six Months ended June 30, 2018 compared to Six Months ended June 30, 2017

During the six months ended June 30, 2018, the Company posted revenues of $74,466. In contrast, during the six months ended June 30, 2017, the Company posted revenues of $116,509 and a retained customer deposit of $48,531. The decrease in revenues resulted primarily from a product set reorganization, not reduction of demand, of one of the Company’s major customers.

During the six months ended June 30, 2018, the Company posted cost of goods sold of $39,464, sales and marketing expenses of $17,611, general and administrative expenses of $590,405, and interest expense of $9,512. In contrast, during the six months ended June 30, 2017, the Company posted cost of goods sold of $47,639, sales and marketing expenses of $3,882 and general and administrative expenses of $43,457. The increase in expenses was related to the shift from R&D to the commercialization of the Company’s products, the costs of becoming a public company, and the patent license fee.

Net loss for the six months ended June 30, 2018 was $582,526, as compared to net income of $70,062 for the six months ended June 30, 2017. The decrease in net income is attributable to decreased revenues resulting from a product set reorganization, not reduction of demand, of one of the Company’s major customers and increases in operating costs related to the shift in focus towards the commercialization of the Company’s products, the costs of becoming a public company, and the patent license fee.

During the six months ended June 30, 2018, the Company used cash in operating activities of $97,770. During such period, the Company also generated cash from financing activities of $50,000. In contrast, during the six months ended June 30, 2017, the Company generated cash from operating activities of $40,310. During such period, the Company also used cash in investing activities of $650 and in financing activities of $52,091.

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Discussion of Three Months ended June 30, 2018 compared to Three Months ended June 30, 2017

During the three months ended June 30, 2018, the Company posted revenues of $33,166. In contrast, during the three months ended June 30, 2017, the Company posted revenues of $30,335 and a retained customer deposit of $48,531.

During the three months ended June 30, 2018, the Company posted cost of goods sold of $13,159, sales and marketing expenses of $3,881, general and administrative expenses of $497,887, and interest expense of $4,968. In contrast, during the three months ended June 30, 2017, the Company posted cost of goods sold of $17,658, sales and marketing expenses of $1,452 and general and administrative expenses of $21,103. The increase in expenses was related to the shift from R&D to the commercialization of the Company’s products, and the costs of becoming a public company, and the patent license fee.

Net loss for the three months ended June 30, 2018 was $486,729, as compared to net income of $38,653 for the three months ended June 30, 2017. The decrease in net income is due to increases in operating costs related to the shift in focus towards the commercialization of the Company’s products, becoming a public company, and the patent license fee.

Off-Balance Sheet Arrangements

 

The Company has no operations nor does it currently engage in any business activities generating revenues. off-balance sheet arrangements.

Equipment Financing

The Company’s original principal business objective was to achieve a business combination with a target company.Company has the following existing equipment financing arrangements:

 

On May 4, 2018 an Acquisition Agreement was entered into to acquire 100% of the ownership units ofJanuary 1, 2016, Anutra Super Grain, LLC (“ASG”). See Form 8-K filed entered into an Equipment Operating Lease Agreement with Angelo Morini (“Mr. Morini”), an officer and member of ASG, pursuant to which ASG leased certain equipment from Mr. Morini described as “Grinder, Shrink Wrap & Label Stamping Machines” in exchange for 60 payments of $150 due on May 7, 2018a monthly basis. The agreement shall expire on December 31, 2020 unless terminated prior to the end of the lease term.

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On July 1, 2017, ASG entered into an Equipment Operating Lease Agreement with Angelo Morini, an officer and member of ASG (“Mr. Morini”), pursuant to which ASG leased certain equipment from Mr. Morini described as “Auto Labeler” in exchange for additional information.60 payments of $100 due on a monthly basis. The agreement shall expire on June 1, 2022 unless terminated prior to the end of the lease term.

 

AsOn November 1, 2017, ASG entered into an Equipment Operating Lease Agreement with Angelo Morini, an officer and member of March 31, 2018ASG (“Mr. Morini”), pursuant to which ASG leased certain equipment from Mr. Morini described as “All Fill Machine” in exchange for 60 payments of $100 due on a monthly basis. The agreement shall expire on October 1, 2022 unless terminated prior to the Company had not generated revenues and had no income or cash flows from operations since inception. The Company sustained net operating lossesend of $594 and $789 for the three months ended March 31, 2018 and 2017 respectively; and had accumulated deficitslease term.

Source of $5,445 and $4,851 as of March 31, 2018 and December 31, 2017, respectively.Revenues

 

The Company’s previous independent auditors have issued a report raising substantial doubt about the Company’s ability to continue as a going concern. At present, the Company has no operations and the continuation of the Company as a going concern is dependent upon financial supportearns revenue from selling its stockholders, its ability to obtain necessary equity financing to continue operations and/or to successfully operate as ASG as described above.

Management will pay all expenses incurred by the Company until a change in control is effected. There is no expectation of repayment for such expenses.

The president of the Company is the managing member of ASG, the target in the business combination that was consummated on May 4, 2018. Form 8-K file on May 7, 2018 is hereby incorporated by reference.

ASG produces and sells products made with a new cultivar of grain, marketed as “ANUTRA® Grain”. ANUTRA® Grain products are sold as food and nutritional supplements. We believe it is the highest and safest natural source of Omega-3’s, antioxidants, fiber, complete protein, and other important phyto-nutrients.products.

  

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

Information not required to be file by smaller reporting companies.

 

ITEM 4. CONTROLS AND PROCEDURES

 

Pursuant to Rules adopted by the Securities and Exchange Commission, the Company carried out an evaluation of the effectiveness of the design and operation of its disclosure controls and procedures pursuant to Exchange Act Rules. This evaluation was done as of the end of the period covered by this report under the supervision and with the participation of the Company’s principal executive officer (who is also the principal financial officer).

  

Based upon that evaluation, the principal executive and financial officer believes that the Company’s disclosure controls and procedures are effective in gathering, analyzing and disclosing information needed to ensure that the information required to be disclosed by the Company in its periodic reports is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Act is accumulated and communicated to the issuer’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

 

Changes in Internal Controls

 

There was no change in the Company’s internal control over financial reporting that was identified in connection with such evaluation that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

   


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PART II – OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS

 

There are no legal proceedings against the Company and the Company is unaware of such proceedings contemplated against it.

  

ITEM 1A. RISK FACTORS

 

Information not required to be filed by smaller reporting companies.

 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

During the period ended March 31,June 30, 2018, the Company issued 6,000,00019,473,400 common shares pursuant to Section 4(2) of the Securities Act of 1933 at par to consummate the reverse merger as follows:reported on Form 8-K filed May 7, 2018.

 

The Company issued the following shares of its common stock:

  

Date Name Number of Shares 
March 15,May 4, 2018 Angelo S. Morini 6,000,000

The Company cancelled the following shares in preparation for a change in control:

DateNameNumber of Shares14,597,760 
March 14,May 4, 2018 James CassidyMinority owners of Anutra Super Grain LLC and others 9,750,000
March 14, 2018James McKillop9,750,0004,875,640 

ITEM 3. DEFAULTS UPON SENIOR SECURITIED

 

Not applicable.

 

ITEM 4. MINE SAFETY DISCLOSURES

 

Not applicable

 

ITEM 5. OTHER INFORMATION

 

(a)Form 8-K filed on May 7, 2018 is hereby incorporated by reference.
(b)Form 8-K/A filed on August 24, 2018 is hereby incorporated by reference.

(a) Form 8-K filed on May 7, 2018 is hereby incorporated by reference.

(b)(c) Item 407 (c)(3) of Regulation S-K:

 

During the quarter covered by this Report, there have not been any material changes to the procedures by which security holders may recommend nominees to the Board of Directors.

 

ITEM 6. EXHIBITS

 

3.1Articles of incorporation of Anutra Corporation. Form 8-K filed on February 22, 2018 is hereby incorporated by reference.
31Certification of the Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act, as amended
32Certification of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002
101.INSXBRL Instance Document
101.SCHXBRL Taxonomy Schema Document
101.CALXBRL Taxonomy Calculation Linkbase Document
101.DEFXBRL Taxonomy Definition Linkbase Document
101.LABXBRL Taxonomy Label Linkbase Document
101.PREXBRL Taxonomy Presentation Linkbase Document

  


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SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

 ANUTRA CORPORATION
   
 By:/s/ Angelo S. Morini
  Chief Executive Officer and
Chief Financial Officer

  

Dated: May 21,September 12, 2018


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